The Dominion. SATURDAY, SEPTEMBER 6, 1919. INDUSTRIES AND THE CONSUMER

Dominion, Volume 12, Issue 293, 6 September 1919, Page 6

The Dominion. SATURDAY, SEPTEMBER 6, 1919. INDUSTRIES AND THE CONSUMER

Timely observations on the need of a more progressive policy in fostering and controlling local industries were made in the House of lleprcsentativcs yesterday in the course of a debate on a private member's Bill, Considerable emphasis was laid by several members on the_ fact that in the existing protection of industries by the Customs tariff nothing is done to protect the consumer. This aspect of thfe matter certainly ought not to be overlooked at a time when the question of encouraging the growth and expansion of industries is rightly commanding a, great deal of attention. Under a sound policy of industrial development regard for the interests of the consuming public instead of being ignored would be the ruling consideration. The only reservations called for are that rigid protection by Customs duties or . otherwise is warranted in some Wises xo exclude iroiu the local market goods produced abroad by unouly cheap, or sweated labour, aiici ttiat there may be some industries it is advisable to maintain and de-velop-even though the goods they produce could be obtained at cheaper rates by importation, in general, liOM'ever.. the policy ol iostenng local industries might easily be reconciled with full regard for the. interests of the consumer. Except whore special considerations enter, trie industries worth protecting and. fostering by means ol duties on importations and in other ways are thoso which within a reasonable period will be able to stand on their own feet and i'ciy on Quality or cheapness of output, or both, for their prosperity. i "''ho i existing protection of industries in New Zealand is chiefly iv mrkablo for. its lack of intelligent method. As one of its results tno system of giving certain industries a settled margin of protection year after year for an indefinite period rather discounts than stimulates enterprise. If manufacturers knew that the protection they enjoy would gradually diminish until it was cither substantially reduced or entirely abolished they wouljJ have an Incentive to industry which at present is non-existent. Economy would bo studied all along tlio lino from the factory to the consumer. Capitalists and . workers would <£tiow that steadily improving efficiency was a condition of the continued existence and prosperity of thcii" industry and all-round benefits would result, since those engaged in one industry stand in the relation of consumers to many others. _ Unless such results are to be attained as a rule in protecting and fostering industries it is difficult to see what there is to set against the impost levied on consumers in the shape of enhanced prices. It is not _ surprising to tad that the operation of a system of protection which departs so seriously in this rcspect from sound principles is at the same time marked by extraordinary anomalies. Owing to its cumbersome and inelastic character the present New Zealand tariff completely withholds in sonic instances the protection it is intended to afford to new and promising industries. It has not been amended, except in details, chiefly with a view to war taxation, since 1907, and the result, h seen in such facts as were traversed by the Parliamentary Industries Committee in its recent report. _ The committee points out that sinco the existing tariff came into operation the conditions' of trade and industry have materially altered. "Many importations," it adds, "such as labour-saving machinery, road-making machinery, etc., aro being charged high duties under the 'not otherwise enumerated provision of-the tariff, simply because such machinery was not known when the tariff was framed,"

I As it stands the tariff is open to condemnation _on the ground that the indiscriminafing protection it. gives to some industries (while others as deserving or more deserving are negfcctcd) tends rather to paralyse than to stimulate enterprise and also to create opportunities for monopolistic trading, and that tho interests of the consumer, which ought in most cases to be paramount, are completely subordinated. Evidently in order that tho consuming public may be adequately protected while industries arc fostered _as they ought to be much more is necessary • than the comprehensive overhaul of tho Customs tariff it so badly needs. It is hopeless to talk of doing anything with the Customs tariff during the present session, but there does not, seem to be any reason why the Government should not establish a Department of Industries and Commerce capable of dealing in a practical way with problems wliich in their most essential aspects are at present neglected. Organisccf on the lines recommended by the Industries Committee, such" a department would be able to render invaluable service both in fostering industries on right lines and in safeguarding the consuming public. Under _ its sway industries would be assisted intelligently and with method. A clumsy and in many respects ineffective tariff, standing . unchanged for long periods, could be replaced by t> flexible system of duties varied from time to time as circumstances, might demand. The case, for the permanent as distinct from the diminishing protection of given industries could be considered on its merits. At the same time if the plan'were adopted_ of licensing some forms of business enterprise with a view to controlling prices and profits—and the plan has a good deal to commend it—such an authority as the proposed department would be essential to the efficient operation of the system.